South Africa’s 2025 Budget Faces Collapse Amid Political Turmoil
Johannesburg – South Africa’s 2025 budget process has become a political battleground, with the critical Appropriations Bill now facing potential failure due to escalating tensions within the Government of National Unity (GNU). Parliamentary leaders warn the country could face a government spending crisis if the impasse isn’t resolved before the July 23 vote.
Budget Crisis Looms as Political Deadlock Deepens
Mmusi Maimane, Chairperson of Parliament’s Standing Committee on Appropriations, told BusinessTech that “there is a very real risk” the Appropriations Bill might not pass. This legislation authorizes all government spending and allocates funds to departments – making its approval essential for continued government operations.
The crisis stems from an unusual parliamentary rule: if even one departmental budget vote fails to secure majority approval, the entire Appropriations Bill collapses. “Only 10% of a department’s budget can be spent if this happens,” Maimane explained. “This won’t cover salaries, let alone service delivery.”
GNU Fractures Over Fiscal Policy
The fragile GNU coalition, formed after the ANC lost its parliamentary majority in 2024, has been plagued by disagreements since February. Initial budget delays occurred when the Democratic Alliance (DA) opposed a proposed 2% VAT increase. After three revisions, Finance Minister Enoch Godongwana finally secured passage by replacing the VAT hike with a fuel levy increase.
However, tensions reignited when President Cyril Ramaphosa fired DA Deputy Minister Andrew Whitfield. DA leader John Steenhuisen retaliated by threatening to block budgets for ANC-led departments allegedly involved in corruption, including Higher Education and Human Settlements.
Constitutional Crisis Possible
The standoff has created unprecedented uncertainty in South Africa’s budgeting process. ActionSA parliamentary leader Athol Trollip noted: “In the past, the ANC would simply table a budget, vote it through, and move on. Now, even after three versions, it’s still unresolved.”
Economist Dawie Roodt warned that the political instability is damaging investor confidence more than the budget delays themselves. “The ANC waits for the DA to leave, and the DA waits for the ANC to kick them out,” Roodt observed. “The ANC hasn’t accepted they’re actually in a coalition.”
Countdown to July 23 Vote
With the crucial vote approaching, ANC Parliamentary Chief Whip Mdumiseni Ntuli expressed confidence about securing passage, calling it a “national imperative.” However, opposition parties outside the GNU – including the EFF and MK party – continue opposing budgets, while ActionSA’s support remains uncertain.
Maimane urged the GNU to “get its act together,” warning that failure would hurt both investor confidence and ordinary South Africans. As the deadline nears, all eyes remain on whether the fragile coalition can overcome its differences to pass South Africa’s most contentious budget in decades.
Source: BusinessTech